The Chancellor has unveiled a further series of measures to support people, jobs and businesses across the UK.
Chancellor of the Exchequer Rishi Sunak has outlined a new package of measures designed to protect millions of people’s jobs and incomes as part of the national effort in response to coronavirus. The announcement was made after the Government ordered the closure of entertainment and hospitality premises to limit the spread of the virus.
A new Coronavirus Job Retention Scheme will be set up to help pay people’s wages. Employers will be able to contact HMRC for a grant to cover most of the wages of their workforce who remain on payroll but are temporarily not working during the coronavirus outbreak. Any employer in the country - small or large, charitable or non-profit will be eligible for the scheme.
To ease cash flow pressures for UK VAT registered businesses, VAT bills from now until the end of June will be deferred until the end of the tax year.
The workers’ support package means:
- UK workers who are placed on the Coronavirus Job Retention Scheme can keep their job, with the government paying up to 80% of a worker’s wages, up to a total of £2,500 per worker each month. These will be backdated to 1 March 2020 and will be initially open for three months, to be extended if necessary.
- VAT payments due between now and the end of June will be deferred. No VAT registered business will have to make a VAT payment normally due with their VAT return to HMRC in that period. Income tax payments due in July 2020 under the Self Assessment system will be deferred to January 2021, benefitting up to 5.7 million self-employed businesses.
- Businesses that are paying sick pay to employees will be supported. The Government will bring forward legislation to allow small-and medium-sized businesses and employers to reclaim Statutory Sick Pay (SSP) paid for sickness absence due to COVID-19.
- The Coronavirus Business Interruption Loan Scheme, announced at Budget 2020, will now be interest free for twelve months (initially it was capped at six months).
HMRC hopes to get the Coronavirus Job Retention Scheme up-and-running with haste and it expects the first grants to be paid within weeks.